Job Work procedure by using Job Worker Excisable Material

We have recieved an order for doing job work, by using one excisable material. Customer will send one excisable material with Job Work Challan. To complete that Job Work, we need to use one Excisebale material (CENTVAT part taken in to registers). After completing that, we will send the produced material to customer along with Challan.

We have recieved an order for doing job work, by using one excisable material. Customer will send one excisable material with Job Work Challan. To complete that Job Work, we need to use one Excisebale material (CENTVAT part taken in to registers). After completing that, we will send the produced material to customer along with Challan.

Now may I know the Excise Duties Part and VAT Part.

you cant use ur own inputs on which cenvat credit has been availed, in job work , if u do so, it will amount to manufacture and will invite excise duty payment on final product at the time of removal !!

ask your principal to send the aforsaid component also under job work challan, for ease of process.

We have recieved an order for doing job work, by using one excisable material. Customer will send one excisable material with Job Work Challan. To complete that Job Work, we need to use one Excisebale material (CENTVAT part taken in to registers). After completing that, we will send the produced material to customer along with Challan.

Now may I know the Excise Duties Part and VAT Part.

you cant use ur own inputs on which cenvat credit has been availed, in job work , if u do so, it will amount to manufacture and will invite excise duty payment on final product at the time of removal !!

ask your principal to send the aforsaid component also under job work challan, for ease of process.

Other wise by reversing the duty part for that material, can we use it for Job Work.

Job work is a widely followed practice. In this practice a principal manufacturer sends raw materials to job worker for various processing. In this processing, the job worker uses some consumables, minor materials, capital goods and input services. This process involved in job work may amounts to manufacture, in which case Central Excise duty is payable, or may not amount to manufacture, in which case service tax is payable under the head business auxiliary service. When processed goods after job work is returned to the principal manufacturer, which is further used by the principal manufacturer in further production on which ultimately Central Excise duty is paid; such job work is exempted from payment of Central Excise duty vide Notification 214/86 or under Cenvat Credit Rules & Service Tax is exempted under Notification 8/2005.

The job-worker is carrying job-work in terms of Central Excise & Service Tax law and procedures. Central Excise or service tax law and procedure does not prohibit a job worker from utilizing other inputs or input services in addition to raw material received by him from the principal manufacturer. There is no bar under in Central Excise from using own material in addition to material supplied by the principle manufacturer as this view is also held in Shakti Insulated Wires Ltd Vs. CCE [1999 (114) ELT 424] further, it is submitted that a jobworker, after using his own inputs used in the job-work of the goods/raw materials can clear the said goods/raw materials to the principle manufacturer without payment of duty after availing the Cenvat credit on the inputs used by him, provided, the duty ultimately gets paid by the principle manufacturer. In other words, a job-worker can avail Cenvat credit on the inputs/input services used by him in undertaking job-work and after availing Cenvat credit on such inputs/input services can clear the goods to the principle manufacturer without payment of duty only when, the duty is finally paid by the principle manufacturer. In this case, the duty does not get paid at the job-worker’s end at the time of clearence of the goods, but ultimately gets paid at the manufacturer’s end.

Job work is a widely followed practice. In this practice a principal manufacturer sends raw materials to job worker for various processing. In this processing, the job worker uses some consumables, minor materials, capital goods and input services. This process involved in job work may amounts to manufacture, in which case Central Excise duty is payable, or may not amount to manufacture, in which case service tax is payable under the head business auxiliary service. When processed goods after job work is returned to the principal manufacturer, which is further used by the principal manufacturer in further production on which ultimately Central Excise duty is paid; such job work is exempted from payment of Central Excise duty vide Notification 214/86 or under Cenvat Credit Rules & Service Tax is exempted under Notification 8/2005.

The job-worker is carrying job-work in terms of Central Excise & Service Tax law and procedures. Central Excise or service tax law and procedure does not prohibit a job worker from utilizing other inputs or input services in addition to raw material received by him from the principal manufacturer. There is no bar under in Central Excise from using own material in addition to material supplied by the principle manufacturer as this view is also held in Shakti Insulated Wires Ltd Vs. CCE [1999 (114) ELT 424] further, it is submitted that a jobworker, after using his own inputs used in the job-work of the goods/raw materials can clear the said goods/raw materials to the principle manufacturer without payment of duty after availing the Cenvat credit on the inputs used by him, provided, the duty ultimately gets paid by the principle manufacturer. In other words, a job-worker can avail Cenvat credit on the inputs/input services used by him in undertaking job-work and after availing Cenvat credit on such inputs/input services can clear the goods to the principle manufacturer without payment of duty only when, the duty is finally paid by the principle manufacturer. In this case, the duty does not get paid at the job-worker’s end at the time of clearence of the goods, but ultimately gets paid at the manufacturer’s end.

Thank you very much,

Is there any involvement of VAT Part and also is there any need to reverse the CENVAT against that input raw material used by us for Job Work.

sir, a principal send material to a job worker for proccesing and the material to be used in the process is to be of job worker itself than what would be the effect of vat&service tax on that material used in the process by the job worker?

What is the process for goods remover form factory if its excisable goods & which register is mainatin for same. if any special register maintain for same please give us formate in excle formate if available.